Modernizing your approach to offering vehicle protection products

We’ve all been there. The phone rings from an unlisted number. It’s not a number you know, but maybe it’s your new dentist calling to confirm an appointment. With hesitation, you answer. A short pause. You sense you’ve made a mistake.

Hello! We’ve been trying to reach you about your car’s extended warranty!!!

They’ve found you. Again. They said the last time was the final attempt, but it was all lies. It doesn’t matter where you are, if you’ve moved, changed phone numbers, changed your identity—even if you don’t own a car, the calls will persist. There is no escape.

What is a credit union to do? You don’t want your members to hate you with the passion reserved for the extended warranty robo-calls, but you want to offer a valuable product that could actually save them money and stress.

In this article, we’ll explore why credit unions need to modernize their approach to offering vehicle protection products and give your institution tips for appealing to today’s consumer.

Modern Consumers Tend to Keep their Vehicles Longer

Thanks to better materials and advances in technology, vehicles are lasting longer than ever before. The average age of a vehicle on the road today is 11.8 years and owners are keeping their vehicles for six or more years.

To protect your members who choose to hold on to their vehicles well past the manufacturer warranty, credit unions can adapt by offering vehicle protection programs with high mileage limits—or even no cap on mileage.

Should your member ever find themselves in a position where they have to depend on the protection plan to cover necessary vehicle repairs that can easily climb into the high thousands of dollars, your institution would be seen as the hero.

Providing vehicle protection is one effective way to meet the changing needs of your members and build borrower trust and loyalty. As an added bonus, offering this product creates a competitive advantage for your credit union, generates non-interest income, and protects you from deferred maintenance situations that can lead to overly depreciated assets.

Modern Consumers Expect Conveniently Accessible Technology

Providing a great member experience is a leading goal for today’s consumer-focused credit unions. Delivering new products seamlessly on your members’ preferred channel goes a long way toward achieving this goal. This is especially vital in today’s marketplace where consumers are increasingly conducting their financial business on their own using self-service technologies.

Offering convenient online enrollment for your vehicle protection program that is supported by a mobile app will create a hassle-free experience for your members that meets their expectations for accessible technology.

Modern Consumers Are Distrustful of Financial Institutions—So Prove Them Wrong

Data from the 2020 Financial Trust Index paints a bleak picture for individuals’ relationship with their financial institutions. It reveals a decrease of trust in financial institutions and increased frustration with the economy, with only 31.3% public trust in financial institutions.

As the arbiter of home and auto loans, the custodian of checking and savings accounts, and the primary contact for financial inquiries, you play a major role in your members’ financial wellbeing.

While your members’ needs may vary, the one thing that remains consistent is they want products and services that bring value to their lives.

To help credit unions deliver a product that is relevant and timely in today’s economy, SWBC’s Financial Institution Group is pleased to introduce healthCAR—a new, budget-friendly way for members to protect their vehicle after their manufacturer’s warranty expires with easy online enrollment and no mileage restrictions.

A simple, affordable, month-to-month, vehicle service contract, healthCAR can help generate non-interest income for your credit union and address the needs of a wide segment of your membership base, including direct and indirect borrowers, members with auto loans at other institutions, recently paid-off loans, and members with vehicles past the manufacturer’s warranty. Click here to learn more.

Ronni Martinez

Ronni Martinez

Ronni Martinez joined SWBC in 1998 and is currently the Vice President of Product Management for SWBC’s Financial Institution Group. Prior to joining SWBC, she held positions in the ... Web: Details